NIM01425 | Class 1 structural overview: Zero-rate of contributions for Armed Forces Veterans: Veterans Upper Secondary Threshold (VUST)

Section 8 of the National Insurance Act 2022 (NICA 2022)

From April 2021, a new secondary Class 1 threshold where the zero-rate of contributions for Armed Forces Veterans was claimed. This is called the Veterans Upper Secondary Threshold (VUST).

The VUST was set at the same amount as the Upper Earnings Limit (UEL). However, there’s no statutory link between the UEL and VUST.

For the purposes of section 6 of NICA 2022, for the tax years from 6 April 2021 onwards, the Veterans Upper Secondary Threshold is £967 (per week).

The prescribed equivalent for earners paid monthly is £4,189 and for earners paid yearly is £50,270.

The VUST caps the level of earnings at which the 0% rate of secondary Class 1 NICs applies. Earnings above this threshold will be assessed at the main secondary Class 1 rate of National Insurance.

You can find the NICs category letter for Veterans at NIM01430.

The examples at NIM01445 demonstrate how the VUST works.